Standard & Poor's Cuts Ethan Allen Ratings

As of March 31, the company had about $203 million of total funded debt, excluding operating lease obligations, according to Standard & Poor's.

The agency said ratings on Ethan Allen reflect the company's vulnerability to reduced discretionary spending in an economic downturn and its exposure to the highly competitive residential furnishings industry.

Ethan Allen benefits from its brand strength and dedicated retail distribution network, Standard & Poor's said, adding that continued declines in the housing market and their effects on the furniture industry remain a significant rating concern.

Shares of Ethan Allen dropped 46 cents, or about 4 percent, to close at $11.14.